Abuse of Dominant Position and Cease-and-Desist Agreements: Risks to Brazilian Competition Policy Arising from the Atypical Case of Petrobras’ Refineries

Abstract

This paper aims to analyze how the Brazilian competition authority, Cade, deals with cease-and-desist agreements involving abuse of dominant position. The focus is a recent abuse-of-dominant-position case. Cade and the Brazilian state-owned oil and gas company, Petrobras, negotiated a cease-and-desist agreement establishing as remedy the divestment of eight out of 13 Petrobras’ refineries. The hypothesis is that the case was atypical in the light of Cade’s own case law. The paper assesses the Petrobras’ case and compares it to Cade’s case law (2012-2019) concerning cease-and-desist agreements relating to the abuse of a dominant position. The results of the study confirm the atypicality of the case. It demonstrates that the case causes risks to Brazilian competition policy. The paper is divided as follows: after an introduction, the first section discusses abuse of dominant position in Brazil, especially the cases that concluded with cease-and-desist agreements; the second section describes the case related to Petrobras’ oil refinery assets; the third section verifies whether the case may be considered atypical; the fourth section debates the legal and policy risks arising from the case; the final section contains some concluding remarks.